Publication year

The oil-rich Gulf Cooperation Council (GCC) countries suffer from the oil price slump while diversification will prove difficult. In the short-run, the necessary budgetary consolidation Oman, Bahrain and Saudi Arabia will weigh on political risk.

Economic growth is expected to maintain its momentum in the medium term underpinned by strong domestic demand and economic diversification. However, the combination of high government spending and a decreased oil price puts pressure on fiscal sustainability.

Economic growth is expected to maintain its momentum in the medium term underpinned by strong domestic demand and economic diversification. However, the increase in current government spending challenges fiscal sustainability.

Oman's economy will grow by 4.9% in 2012, buoyed by domestic demand and external demand for its oil and gas exports. A downside risk is the uncertain global economy, especially the eurozone peripheral debt crisis and slowing growth in China.

The country’s and the sovereign’s solvency is comfortably assured by at least a decade of (often substantial) current account and fiscal budget surpluses, although the value of external assets are not provided. We consider official and hidden reserves to be sufficient to cover for unlikely current account deficits. They are also large enough to defend the fixed exchange rate to the USD.